Sagarmala Finance Scraps Debut ₹600 Crore Blue Bond Amid Pricing Challenges
Sagarmala Finance Corporation Ltd (SMFCL), India’s inaugural maritime non-banking financial company under the Ministry of Ports, Shipping and Waterways, has retracted its first blue bond issuance of ₹600 crore due to investor demands for a higher coupon rate than anticipated. Although SMFCL aimed to price its 10-year bonds below 8%, bids ranged between 7.69% and 8.44%. The corporation received bids worth ₹525 crore but decided to withdraw the offering.
Managing Director L.V.S. Sudhakar Babu noted the unexpected rise in coupon rates as the reason for the retraction. This withdrawal coincides with a similar move by the Small Industries Development Bank of India (SIDBI), which recently halted its planned ₹6,000 crore bond issuance. Both firms pulled back from raising a combined ₹6,600 crore, highlighting increasing borrowing costs amid expectations of rate hikes from the Reserve Bank of India to manage inflation pressures.
The proposed blue bond, rated AA+ by ICRA and CARE, was intended to finance maritime sector initiatives, greenfield port projects, and coastal road networks within the current fiscal year. SMFCL, which started operations in June 2025, aims to bridge financing gaps in the maritime sector with an overall borrowing limit of ₹25,000 crore. Meanwhile, Vadodara Municipal Corporation is still planning a ₹200 crore blue bond issuance.
